Drafting contracts

(g) Step 7: Discussing and establishing the model building blocks

As described in Step 5, the sub-group should review the contract drafter’s proposal, identify issues for decision-making by the best practice group, provide feedback to the contract drafter who will combine everything into a final proposal. The same applies mutatis mutandis for any further review by other best practice members. A pitfall at this stage would be that an individual member of the best practice group ignores (part of) the contract drafter’s work and starts reviewing on the basis of his (or her) personal ‘model’ contract. In such case, the project manager must interfere.

The contract drafter (supported by the project manager) should prevent that various drafting styles are introduced during the discussions in the sub-groups and best practice groups. This may be achieved by referring to best practice rules suggested in a contract drafting manual and by creating summary Contract Drafting Conventions that should be respected by all in-house counsel. A best practice group should not light-heartedly compromise on the drafting quality.

As part of the discussions on the model building blocks, the permitted contract variables, main optional answers and default answers should be agreed as well. The best practice group (or the sub-group responsible for preparing the main initial draft building blocks) should formulate them together with the text of the Q&A questions and explanatory notes.

Where a contract phrase is supposedly filled in only on a case-by-case basis, the best practice group may provide for the most common optional answers.

For example, the ‘Purpose’ as is often defined in the context of a non-disclosure agreement may take different forms depending on the context of the NDA; however, the best practice group may well provide for basic text phrases covering contexts such as R&D-related disclosures, M&A-related due diligence, product assessments or discussions in anticipation of a commercial relationship.

Eventually, the best practice group will formally approve the final text of the model building blocks (and hence of the model contracts based on those building blocks). The best support for actually using the Weagree Wizard is achieved when the model building blocks and model contracts are the result of comprehensive review and consensus amongst the members of the best practice group. The approved text may be made subject to a final review by the contract drafter for consistency and to dot the i’s and cross the t’s.